Method and apparatus for conducting electronic commerce transactions using electronic tokens

Abstract

Methods and apparatus for conducting electronic commerce using electronic tokens are described. The electronic tokens are issued and maintained by a vendor, who also provides products and services that can be purchased or rented using the electronic tokens. The electronic tokens may be purchased from the vendor either on-line, using a credit card, or off-line, using a check, money order, purchase order, or other payment means. Because the vendor is the issuer of the electronic tokens, there is no need for transactions to be handled by a third party, such as a bank or other organization. This reduces the overhead involved in conducting electronic commerce, and provides the vendor with a greater amount of control. Additionally, the vendor maintains total control over the price of the electronic tokens at any time. For vendors who offer software products for sale or rental, use of electronic tokens makes a variety of rental arrangements practical including rental for short periods of time, for a specific number of uses, or for a specific number of processing.

Description

RELATED APPLICATIONS[0001]This application claims priority from U.S. patent application Ser. No. 09 / 553,695, filed Apr. 21, 2000 now U.S. Pat. No. 7,177,838, and from U.S. provisional application Ser. No. 60 / 178,239, filed Jan. 26, 2000.FIELD OF THE INVENTION[0002]The present invention relates to methods and apparatus for conducting electronic commerce using electronic tokens. More particularly, the present invention provides a means to purchase, rent, or extend the rental period on software or other products and services using electronic tokens, which may be purchased either on-line or off-line.BACKGROUND OF THE INVENTION[0003]Electronic commerce using the World Wide Web (Web) is exploding in growth. Many Web sites have been developed through which Web service providers may advertise and offer a variety of products for sale. As electronic commerce becomes popular, increasing numbers of vendors are offering a variety of products and services on the Web. Among these vendors are softw...

AI Technical Summary

Benefits of technology

[0022]It is also an object of the present invention to provide electronic currency or tokens that may be issued and used with minimal overhead, and that do not require on-line communication with a bank or other organization to issue or use the tokens.

[0023]It is a further object of the present invention to provide apparatus and methods that give a vendor complete control over the sale and distribution of electronic currency or tokens that may be used to purchase products and services from that vendor.

[0032]Further, it is an object of the present invention to provide an apparatus and methods to keep accurate records of electronic tokens transferred and converted from one vendor's Web Site to another vendor's Web Site. Therefore, the system would allow one vendor to pay the other vendor the value of the electronic token so transferred and converted.

[0033]It is another object of the present invention to provide an apparatus and methods to supply one vendor's user's name, address and other information necessary to another vendor's Web Site. This would permit the user of one vendor to automatically register with another vendor's Web Site, providing the convenience for the user that he is not required to register with another vendor's Web Site.

[0034]It is another objective of the present invention to keep a record of tokens already paid, tokens to be paid and free tokens issued. This allows the vendor to further issue free tokens for a user with many paid tokens, as if he is earning interest on the paid but unused tokens. Furthermore, free tokens issues are, in general, intended for a user to purchase additional products and services from the issuing vendor, not for transferring to another vendor. Keeping a record of free tokens issued allows a vendor to prevent such transfer.

[0035]It is yet another objective of the present invention that the vendor may display the cost of products or services offered at his Web Site in terms of electronic tokens simultaneously in equivalent cash values in order to assist the user to associate the cost of the corresponding product or service more easily. Furthermore, it is yet another objective of the present invention that the user may choose to purchase items and services using electronic tokens or credit card.

Problems solved by technology

Since some software products are relatively expensive or use of a particular software product may become obsolete after a period or number of uses by a purchaser, the purchaser may want to rent the software product instead of purchasing it outright.

While there may be many consumers on the Web interested in purchasing or renting a wide variety of products and services, many of these consumers are either unwilling to take the risk of using their credit card over the Internet, or do not possess a credit card that may be used to make purchases on the Web.

Additionally, some products and services available over the Web are small enough in cost that they do not justify the overhead of handling credit card transactions.

This eliminates the need for credit cards, but does not address micropayments.

This system, while it does not use a credit card, and may be used for micropayments, is not well suited to more general use, as there is no way to purchase the “beenz” currency.

Such systems necessarily impose overhead, in that both the vendors who accept these various forms of electronic currency, and the users who buy items in exchange for electronic currency must deal with a central organization, such as a bank.

Additionally, since the central organization controls the issuance of the electronic currency, the vendors who accept the electronic currency have no control over the value of the electronic currency, its sale price, the terms on which it may be bought, or to whom the electronic currency is sold.

For example, it is not possible using such systems for a vendor of products or services to agree with his customer on payment terms for electronic currency that will be used to purchase goods, since the customer must pay a bank or other third-party organization for the electronic currency.

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